Monday, March 16, 2015

Gustavus Swift: A Revolution in the American Meat Industry

The
industrial revolution in the United States became home of some of the greatest
innovation that made the modern world. From electricity to automobile,
Americans used their curious mind to solve challenges and create solutions that
make the world better. The food industry also got a share of some of
innovations. Among the men that profited from it was the founder of one of the
most famous food meat processing companies in the United States – Gustavus
Swift.

Gustavus
Swift (June 24, 1839 – March 29, 1903) headed one of the most acclaimed meat
processing company in the United States Swift & Company. His company grew
because of Swift’s investment to the creation of refrigerated railroad cart,
which allowed long distance and cheap distribution of meat. For his support,
Swift benefited from the innovation, which led to the growth of his company.

Gustavus
Swift, born on June 24, 1839, came from Sandwich, Massachusetts. His parents,
William and Sally Swift, worked as farmers and butchers. Already, Gustavus’
family had a background in agricultural and meat industry. His parent’s work
allowed him to earn education for the next eight years. After his study, at the
age of fourteen, he decided to work for his brother, Noble’s, butcher shop.

It
became a path for him to enter the industry. After two years working for his
brother, he decided to establish his own business career. Using his earnings
and money that he borrowed from his father, he moved to Eastham and became a
livestock grower. He raised cattle, pigs, and sheep. His business flourished
and he continued to earn more. In 1862, he began to operate his own slaughter
house and his own butcher shop in Brighton. His butcher shop became well known.
Gustavus sanitation practices of keeping his shop clean earned him consumer
confidence, which translated to customers and profits. Gustavus also managed
parts, which were not popular to customers, by placing them in centers of
attraction. For another decade, his enterprise continued to bloom and by 1872,
he owned another butcher shop in Barnstable.

From
his success as a sole business owner, he decided to expand and entered into a
partnership with James Hathaway and formed the Hathaway & Swift Company.
The partners divided their tasks. Hathaway went to cities and towns in order to
promote their product and attract customers. Swift, on the other hand, handled
the raising of the livestock and their slaughtering. In 1873, he moved to
different places in New York – Albany and Buffalo. Then, in 1875, with the
development of railroads to connecting the East Coast to the hinterlands,
Gustavus decided to move to the center of American livestock and meat industry
– Chicago.

In
Chicago, however, Swift and Hathaway decided to dissolve their partnership and
Gustavus Swift joined his brother to form the Swift Brothers & Company.
Swift and his brother continued to operate their business in Chicago. There,
they discovered the problems of distributing livestock to the East Coast via
railway – it was expensive, inefficient, and wasteful. Livestock owners had to
ship their cattle via railroad alive. En route to their destination, they had
to be fed while on the way. Upon arriving to the destination, some of the
livestock either loss weight, became sickly, or dead already. In addition to
the inefficient transportation, Livestock owner paid high for the freighting of
their livestock. Thus, with money losing on high freight rates and the high
possibility of loss of profit from sickly or dead livestock, it resulted to low
profit margins for livestock owners.

Gustavus
Swift looked for ways to solve the problem. A year before the dissolution of
his partnership with Hathaway, Swift already had experimented ways to
efficaciously and cheaply ship meat from Chicago to the East Coast. He found a
solution to ship more beef in fewer carts by sending the meat chopped and
processed already. The shipping problem remained his next problem. In this
aspect, his experimentation, however, achieved limited success. He shipped meat
during the winter from Chicago to Boston. He had the doors of the cart open so
that cold winter winds could enter and provide a refrigeration effect to the
meat inside the cart. However, the system had flaws. It could only work for
cold winter areas of the United States. It also limited the time of
distribution in winter. It opened the meat to dangerous elements that might
affect sanitation and health. Lastly, if a cart moved to different temperature,
the cooling might led to discoloration and decrease in the quality of the meat.
Nevertheless, from his experiment, Swift conceived the idea of making
refrigerated railroad carts.

In
1878, he worked to make his idea realized. He hired a refrigerator engineer
named Andrew Chase to design the cart. After Chase completed the designs he had
the Michigan Company to build the railroad cart. When Swift had his
refrigerated railroad carts, he faced a problem of finding a line to operate
it. Railroad companies refused to allow the railroad carts because it would
cause a loss in freight. By the 1870’s freight became a huge source of income
for railroad operators as the United States overbuild railroad lines and the
market became saturated. If railroads used the refrigerated carts, they would
lose huge loads of freight because sending process meat rather than living
livestock cost less meaning less profits for railroad companies. Many railroad
companies refused to give in to Swift even he himself negotiated furiously. But
then, he managed to contract that relied less on livestock freight – the Grand
Trunk Railway. The Railway company operated lines between Michigan, Canada, and
then to the East Coast of the United States. In 1882, Swift finally shipped his
first batch of dressed meat to the east coast.

His
shipment of dressed meat in refrigerated carts, however, led to another
conflict in 1886. He faced opposition from butcher shops, who knew that they
could lose their livelihood because of Swift’s innovation. Butchers from
northern states form the National Butcher’s Protective Association and they
launched a campaign to smear the reputation of Swift’s products. They issued
bans on the selling of Swift’s dressed meat. They also launched black
propaganda campaigns that informed consumers that Swift’s products had terrible
taste and cause different health problems. Swifts fought back with more
intensity. He launched advertisement campaigns promoting his products as high
quality and safe to consume meats. Swift eventually gained the upper hand. His
products tasted better and cheaper than those from the butchers. After the conflict,
Swift Brothers & Company grew.

Swift’s
refrigerated carts created an impact in the American meat industry. For the
next decade, shipment of live cattle decreased and by the 1900, it ceased
completely. Shipping cost for meat companies decreased from 10% up to 20%.
Companies like Hormel and Armour used refrigerated carts which led them to
become major players in the industry and even equaled Swift. Eventually, the
idea of refrigerated carts later became applied in ships. The used of
refrigerated storage in ships allowed American processed meat companies to
export their products across the globe, hence expanding their market.

For
Swift, the company continued to prosper. They expanded to Kansas and St. Louis.
They built refrigerated warehouses for storage. They underwent a vertical
integration where Swift controlled the raising of the cattle, slaughterhouses,
processing or dressing, and owned also butcher shops. They even controlled
their own advertisement and marketing. In 1885, decided to incorporate the
company under the new name, Swift & Company and Gustavus became the
president. By 1890, Swift & Company became famous throughout the United
States. In 1892, Columbian World Exposition in Chicago, Swift & Company
became a sponsor and in the event, he displayed his products. Swift had a
refrigerated cart placed in his booth in the expo and studded it with different
meat and parts. After the expo, the company continued to expand. By the time
the 20th century dawned, Swift had operated 200 butcher shops, 6,000
refrigerated railway cars, and 6 packaging houses in Western United States that
had the capacity of processing 8 million livestock annually. Not to mention,
Swift also became a significant exporter of meat products to other parts of the
world like Singapore and Manila.

Nevertheless,
the growth of the Swift & Company came without issues. He did not like
unions and subdued them, sometimes harshly. He also faced public criticisms
because of animal waste coming out from his plant and polluting rivers and surroundings.
Swift solved this by starting to produce goods made out of animal waste like
hides and fats. He began to produce lards, bags, belts, wallets, etc. Swift
even displayed these products in 1892 World Expo. But the most well-known
criticism of Swift and other meat companies as well was Upton Sinclair’s The
Jungle, which criticized the unsanitary condition that American meat passed
through in the meat packing facilities in Chicago. Also, in 1902, Swift &
Company faced investigation from the Federal Government that pointed Swift
& Company along with other meat companies engaged in pricing and other
illicit business practices. Eventually, the Swift & Company survived after
it joined forces with other meat packing companies like Armour.

Gustavus
Swift passed away on March 29, 1903 in Lake Forest Chicago. His wealth amounted
about $50 million. His legacy became embodied in the change of the American
meat packing industry his support and idea of a refrigerated cart translated to
the growth the American meat packing and processing industry. It also made
Chicago a center of the meat packing industry for quite some time. Gustavus
Swift left a changed meat packing industry, different from the once he saw
first.

2 comments:

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